Objections begin over UAL's plans

Creditors committee needs more time to digest massive document

United Airlines' timetable for wrapping up its record-breaking bankruptcy stay by early 2006 isn't sitting well with creditors.

The official committee of unsecured creditors says it needs more time to digest the 416-page reorganization plan and disclosure statement unveiled last week by the Elk Grove Township-based carrier and is working with United on a compromise, according to a Bankruptcy Court filing.

If the two sides can't reach an agreement by Friday, the creditors committee will present an alternative schedule to a Chicago Bankruptcy Court, according to the Sept. 9 filing.

Under United's timetable, the court is slated to review United's disclosure statement, a detailed look at its restructuring plan, on Oct. 11. Creditors must file their objections and vote on the plan by Dec. 1. Creditors wishing to challenge aspects of the plan must complete discovery by Jan. 9, 2006; and the plan's confirmation hearing would be held Jan. 17 and 18.

Says United spokeswoman Jean Medina: "We believe our proposed exit schedule is realistic and will enable us to work cooperatively and collaboratively with our creditors."

It's in United's interest to finally complete its nearly three-year bankruptcy stint since the carrier expects to receive $2.66 billion in new capital from lenders and escrowed funds once it exits Chapter 11. That money would give United a critical cushion to withstand oil-price shocks and the traditionally slow Winter travel season.

But United's "proposed schedules are too compressed for the parties in interest to reach consensus or properly prepare for hearings on any objections," the creditors committee filing says.